Northwest Community Ventures Fund SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Northwest Community Ventures Fund
Michelle Foster was the general partner of Northwest Community Ventures (NVC), a for-profit equity fund with a socially responsible mission. Following its mandate to invest in rural communities in Oregon and Washington State, Michelle's group depended on outreach venues such as luncheons to attract and build trust with rural entrepreneurs who worked far from the world of traditional venture capital. In early 2005, NCV had just over eight years remaining on its ten-year charter, but Michelle was already thinking about how to best position herself for raising a follow-on fund in year three. As with any venture fund, she'd be out looking for investors long before performance results were in on her current effort. Her concern was whether institutional investors could be attracted to the fund's unique brand of socially responsible venture capital-especially if better returns were available elsewhere, at lower risk. Her primary challenge, however, was Eileen O'Brien, the passionate founder of Grassroots Business Initiatives (GBI), NCV's high-profile, non-profit parent organization. At first, their vastly different business philosophies had been a source of respect, philosophical curiosity and even amusement. Increasingly, though, that relationship had become strained by the pressures that both women were facing in order to satisfy their respective-and highly disparate-goals and obligations.
Swot Analysis of "Northwest Community Ventures Fund" written by Natalie Taylor includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Michelle Fund facing as an external strategic factors. Some of the topics covered in Northwest Community Ventures Fund case study are - Strategic Management Strategies, Entrepreneurship, Financial management, Marketing and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Northwest Community Ventures Fund casestudy better are - – challanges to central banks by blockchain based private currencies, increasing energy prices, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, wage bills are increasing, geopolitical disruptions,
increasing commodity prices, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Northwest Community Ventures Fund
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Northwest Community Ventures Fund case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Michelle Fund, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Michelle Fund operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Northwest Community Ventures Fund can be done for the following purposes –
1. Strategic planning using facts provided in Northwest Community Ventures Fund case study
2. Improving business portfolio management of Michelle Fund
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Michelle Fund
Strengths Northwest Community Ventures Fund | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Michelle Fund in Northwest Community Ventures Fund Harvard Business Review case study are -
Analytics focus
– Michelle Fund is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Natalie Taylor can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Michelle Fund digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Michelle Fund has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Highly skilled collaborators
– Michelle Fund has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Northwest Community Ventures Fund HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Michelle Fund
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Michelle Fund does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Michelle Fund is one of the leading recruiters in the industry. Managers in the Northwest Community Ventures Fund are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Michelle Fund in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Michelle Fund has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Michelle Fund has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Sustainable margins compare to other players in Finance & Accounting industry
– Northwest Community Ventures Fund firm has clearly differentiated products in the market place. This has enabled Michelle Fund to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Michelle Fund to invest into research and development (R&D) and innovation.
Strong track record of project management
– Michelle Fund is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Michelle Fund is present in almost all the verticals within the industry. This has provided firm in Northwest Community Ventures Fund case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High switching costs
– The high switching costs that Michelle Fund has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
High brand equity
– Michelle Fund has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Michelle Fund to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Northwest Community Ventures Fund | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Northwest Community Ventures Fund are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Northwest Community Ventures Fund, in the dynamic environment Michelle Fund has struggled to respond to the nimble upstart competition. Michelle Fund has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Michelle Fund is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Michelle Fund needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Michelle Fund to focus more on services rather than just following the product oriented approach.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Michelle Fund supply chain. Even after few cautionary changes mentioned in the HBR case study - Northwest Community Ventures Fund, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Michelle Fund vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Michelle Fund has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Products dominated business model
– Even though Michelle Fund has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Northwest Community Ventures Fund should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Northwest Community Ventures Fund, is just above the industry average. Michelle Fund needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Lack of clear differentiation of Michelle Fund products
– To increase the profitability and margins on the products, Michelle Fund needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Michelle Fund has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Michelle Fund has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High operating costs
– Compare to the competitors, firm in the HBR case study Northwest Community Ventures Fund has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Michelle Fund 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Northwest Community Ventures Fund HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Michelle Fund has relatively successful track record of launching new products.
Opportunities Northwest Community Ventures Fund | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Northwest Community Ventures Fund are -
Learning at scale
– Online learning technologies has now opened space for Michelle Fund to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Michelle Fund can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Michelle Fund can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Michelle Fund is facing challenges because of the dominance of functional experts in the organization. Northwest Community Ventures Fund case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– Michelle Fund can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Northwest Community Ventures Fund suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Michelle Fund to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Michelle Fund to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Michelle Fund has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Michelle Fund can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Michelle Fund can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Michelle Fund can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Northwest Community Ventures Fund, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Michelle Fund can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Michelle Fund to increase its market reach. Michelle Fund will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Michelle Fund in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Threats Northwest Community Ventures Fund External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Northwest Community Ventures Fund are -
Shortening product life cycle
– it is one of the major threat that Michelle Fund is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Michelle Fund needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.
Consumer confidence and its impact on Michelle Fund demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Michelle Fund in the Finance & Accounting sector and impact the bottomline of the organization.
Increasing wage structure of Michelle Fund
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Michelle Fund.
Technology acceleration in Forth Industrial Revolution
– Michelle Fund has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Michelle Fund needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Michelle Fund needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Michelle Fund high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Michelle Fund can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Michelle Fund in the Finance & Accounting industry. The Finance & Accounting industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Northwest Community Ventures Fund, Michelle Fund may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Stagnating economy with rate increase
– Michelle Fund can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Weighted SWOT Analysis of Northwest Community Ventures Fund Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Northwest Community Ventures Fund needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Northwest Community Ventures Fund is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Northwest Community Ventures Fund is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Northwest Community Ventures Fund is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Michelle Fund needs to make to build a sustainable competitive advantage.
